Why the IRS Scandal Suddenly Became About Obamacare

It seems as if the battle over the IRS' improper focus on Tea Party groups has splintered into an attack on the Affordable Care Act, better known as Obamacare. But it's more accurate to say that the new scandal is simply the latest reason being used to attack the president's health-care legislation.

Here's how the two are linked. When the Supreme Court upheld the ACA last June, it did so on what could be described as a four-to-four-to-one vote. The Court's four liberal justices supported the policy; four of the five conservatives opposed it. Chief Justice John Roberts's majority opinion upheld the policy for an unexpected reason: Congress has the ability to regulate health care as part of its power to tax. Since the policy was administered through the IRS, the law was Constitutional.

According to CNBC, there are 47 different provisions of the ACA that the IRS is supposed to administer. (An overview of some of the Act's provisions is provided at the IRS website.) That's 47 new things for the IRS to track — meaning a substantial increase in the amount of work the IRS needs to do. According to reporting from the Fiscal Times, the IRS will add over 2,000 new employees to do that work, an addition that also requires a substantial increase in the amount of money the IRS needs.

Attacks on the ACA are not new. Today, the House is expected to vote for the 37th time to repeal the policy entirely. Nor are attempts to inhibit the IRS' ability to administer the policy by curtailing funding new; in March, the House passed a funding resolution that aimed at scrapping that money.

What's new is the leverage provided by the still-brewing IRS scandal. It didn't take ACA opponents long to imply that the IRS' errors and failures in the administration of non-profit status implied that it couldn't be trusted to properly administer Obamacare. Michele Bachmann presented the most extreme argument to that end, but she wasn't alone in suggesting that there was a problem. On Monday's Morning Joe, Newt Gingrich argued that the agency was fundamentally untrustworthy, asking, "Why would you trust the bureaucracy with your health if you can’t trust the bureaucracy with your politics?"

Senator Dean Heller of Nevada was more direct. Yesterday, Heller wrote a letter to Health and Human Services Secretary Kathleen Sibelius indicating that both Congress and her agency must "look closely at the money given to the IRS through the health care law" in light of "recent events" involving the IRS. Heller announced that he planned to introduce a bill that would block the $440 million the agency needs for implementation, though, as the Las Vegas Sun points out, that legislation would be unlikely to get past Senate Majority Leader Harry Reid.

Given the narrow scope of malfeasance outlined in the Inspector General's report about the IRS, it's not yet clear if critiques of the agency as a whole will stick. The president yesterday called for harsh consequences for those involved, albeit not as harsh as demanded by the Speaker of the House.

Should accountability for the mistakes happen quickly, the damage the agency faces would likely be contained. (One thing that probably isn't worrying the IRS is the prospect of a sharp decline in its popularity. A 2009 Gallup poll identified the agency as the third-least popular in the government.)

The calls for Obamacare to be separated from the IRS will continue no matter what happens, as evidenced today in a harsh editorial in the Wall Street Journal. The most striking aspect of that editorial, though, is what isn't prominently featured: the argument that the IRS non-profit mistakes make the case for taking ACA administration away from the IRS. It's mentioned, but it's not needed for the argument. It's almost as if the Journal would have made the case against the ACA regardless of the scandal.